Minister for Finance and Deregulation


Minister for Early Childhood and Childcare

Minister for Employment Participation


31 March 2012




WONG: I’m here today with Kate Ellis to talk about Tony Abbott’s latest policy idea, which is to subsidise nannies. But I want to start by talking about economic credibility. Economic credibility is about having a plan, making sure it’s properly costed and properly funded. Tony Abbott’s never done this.

Who can forget the election campaign where his costings were done by a firm that breached professional conduct rules, that acted unprofessionally? Who can forget the immigration costings that his frontbench released, which were done by a catering company? That is Mr Abbott’s standard when it comes to a plan for the future. No economic credibility at all. And now we see from figures that the Government is releasing that his latest idea would cost $2 billion. $2 billion over the forward estimates. $2 billion which would add to his already enormous black hole.

So you’d have to wonder, why does Tony Abbott actually say this? Well, we know that because of what his own party room are saying. We know this because today in the papers we have a Liberal Party member, a Liberal Member of Parliament who said ‘no one really thinks we’re going to do it, it’s just part of the appeal to women’. ‘No one really thinks we’re going to do it, it’s just part of the appeal to women’.

So, Mr Abbott’s own members have made it clear, this is nothing more than a cynical manoeuvre. It’s not real, it won’t be funded because they can’t fund it. And it’s just part of a cynical move to get people to think he’s more than Dr No. If he’s going be more than Dr No he’s got to come up with policies that are properly funded. Now I’ll hand over to Kate to talk a bit more about these comments.

ELLIS: Thank you very much Penny. Tony Abbott made clear when he said that taxpayers should subsidise nannies that that funding should come from ‘the existing funding envelope.’ Let’s be very clear about what that means. Today’s analysis shows that taxpayers would have to stump up $2 billion out of existing child care subsidies in order to fund nannies. What that means, $2 billion, is that 654,000 Australian families on child care benefits would be looking at a 20 per cent cut to those benefits. I’m saying to the Opposition today that they need to be very clear with the families of Australia just who is going to face these cuts, and how much.

JOURNALIST: How did you cost that expense for the project?

ELLIS: These costings came from the Department of Education, and have gone through the Finance Department. These costings are based on ABS statistics about how people are using nannies, and would use nannies, at an average wage. At the moment we know that nannies are paid between $15 and $35. These costings are on $25 an hour.

These costings have gone through the Finance Department, they have been assured in that way. We’re confident of these figures. What we’re not confident of is how Tony Abbott will fund the $2 billion out of the existing envelope without hitting the assistance which 654,000 Australian families are relying on to meet their child care costs.

JOURNALIST: Wouldn’t that be a justification for getting the Productivity Commission to look at this, even as an option?

ELLIS: Look, we can have as many reviews, as many enquiries as you like. It comes down to a very simple equation. When you have one pot of money, which is already being distributed to the families of Australia, you can’t use that money to do anything else without cutting the money that we’re currently giving to child care services.

JOURNALIST: (inaudible) the Liberals are proposing to help the modern woman, what would Labor do?

WONG: I’ll let Kate respond to that, but I want to make this clear: they’re not proposing anything other than an idea they can’t fund, other than by cutting things that families already get. Let’s remember that.

And let’s remember also what the motivation is, which is the one I outlined to you. It’s not real, it’s just part of the ‘appeal to women’. And if they want to make it real, they would have to make the cuts that Kate’s talked about.

JOURNALIST: Is there any -

ELLIS: Can I just answer that question? In terms of our Government’s assistance to working families, we’re proud to have introduced Australia’s first ever Paid Parental Leave scheme. But we’re also proud that we’ve introduced record levels of affordability assistance for child care services, increasing the Child Care Rebate from 30 per cent to 50 per cent.

We’ve also increased the accessibility of child care services, with a 36 per cent increase in the number of approved services in just the four years since we came to Government. That equates to more than 500 new services opened in the last 12 months alone.  We’re already making real reforms, putting in place real measures, which are making a real difference to working families. We’re not just coming up with undeveloped, uncosted thought bubbles.

JOURNALIST: Is it time to reassess that Child Care Rebate model, perhaps higher than 15 per cent to meet current women’s needs?

ELLIS: The model was at 50 per cent. This is the highest level of assistance we’ve ever seen in Australia’s history. This is also being increased up to a cap of $7,500 per child. This is pretty generous assistance that we put into place because we know that we need real and effective measures to help working families with the care for their children when they go off to work. Our Government recognises this, but we’ve actually got runs on the board for delivering it, not just for coming up with (inaudible).

JOURNALIST: Is there any trouble with making the system more flexible if you opened up the options with other rebates to other sorts of services, like nannies for example, that people might shift what they look for depending on what rebates and what sort of funding arrangements were available?

ELLIS: I’m incredibly proud that our Government has worked to increase the quality of early education care services in Australia. We’ve done that by ensuring increased professionalisation, increased qualifications, increased training for staff. Now, against that, even on the $2 billion costing analysis released today, that is on a nanny sector which is unregulated, which has no minimum qualifications.

If you actually wanted to increase the quality of the nanny system, to bring it anywhere near into line with existing approved child care services you would be looking at additional, substantial funding on top of it. Funding which Tony Abbott doesn’t have, and which he’s ripping out of the pockets of working families in the form of their existing child care rebates.

JOURNALIST: So you don’t have any plans to look at other options other than (inaudible)?

ELLIS: We recognise that you need flexible solutions. This Government has substantially increased the number of in-home care places, which go to women – and indeed men – who are shift workers, who may have a child with a disability, or who may be in an area where there aren’t other approved services available. We’ve actually got a system in place that (inaudible). On the other hand, we’re talking about an empty promise from an Opposition Leader, that his own backbench doesn’t believe he’s going to put into place.

JOURNALIST: Isn’t the suggestion justified though since there is such a lack of child care places?

ELLIS: Well, as I said, we’ve seen an increase of 36 per cent in the number of approved services in Australia. We’ve seen 500 additional centres just in the last 12 months alone. And if we have a look at the vacancy data, we see that around it’s 90 per cent of services that are indicating that they have vacancies at the moment. So, when you talk about what’s actually happening out there in the sector, the reality is that child care in Australia – than it’s ever been – is more accessible, and is now of a higher quality. And we’re very proud of that record.

JOURNALIST: Can we talk just about the potential budget cuts, and what it will do for a Disability Insurance Scheme?

WONG: I see there’s reports in the paper about the National Disability Insurance Scheme. Obviously I’m not going to comment on budget speculation. I would say this: I think Australians across this country, many Australian families, understand first-hand the need for disability services in this country. We’re Labor people, we understand the importance of dealing with those Australian who are in need. But we also understand that there’s a lot of work to be done. But as I’ve said, I’m not going to comment on speculation.

JOURNALIST: So, What benefits would there be potentially in line then for?

WONG: I think you’re asking me to do precisely what I just told you I wouldn’t do, which is to speculate on what might or might not be in the Budget. I mean, the Prime Minister’s made very clear her priority on this issue. We will keep doing the work through (inaudible) that’s required.